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Inter-Regional Factors in the Location of New Nuclear Power Stations in England and Wales
Published in Andrew Blowers, David Pepper, Nuclear Power in Crisis, 2019
A major tool in planning and organising the supply side is the merit order, a ranking of power stations by operating costs. Modern plant has lower operating costs than older plant and it thus occupies the top positions in the merit order. Hydro-electricity stations, of which there are few, have low operating costs irrespective of age. This is also true of nuclear power stations, although to sustain low operating costs many have been derated; that is their capacity has been reduced. Oil-fired power stations have suffered until recently from soaring fuel prices since their construction and they have never occupied the high merit order places intended for them, except during the miners’ dispute. Plants at the top of the merit order are allocated to base load generation and plants lowest in the merit order generate only at time of peak demand. Plants in the middle of the merit order are used to generate the day-time base load throughout the year and will typically be used to about 40–50 per cent of annual capacity. As new plant enters the merit order, it will naturally displace older and less efficient plant and thus reduce generation costs in total. New plant has incurred substantial capital cost in construction and intensive use is desirable to allow a quick return on investment. In a system where demand is static, too rapid introduction of new plant will mean premature relegation in the merit order of plants which have yet to be fully depreciated, thus raising rather than reducing total cost.
Switzerland
Published in Susanne Hanger-Kopp, Jenny Lieu, Alexandros Nikas, Narratives of Low-Carbon Transitions, 2019
Utilities and renewable plant developers are particularly concerned about the current low price of electricity in Switzerland and the EU power market, as a result of the ongoing expansion of renewables in Germany and elsewhere. The ‘merit order effect’ reduces prices when renewable electricity is abundant (i.e. sunny weather and high winds across the EU) and drives up prices of balancing power when renewable electricity is scarce, making renewable electricity a victim of its own success (see Cludius et al., 2014). This has reduced enthusiasm for installing renewable electricity by utilities. Consumer-owned rooftop PV has not been affected as much, as domestic production reduces electricity bills that include taxes and grid fees (electricity cost is only half the total) and the Swiss feed-in tariff policy.
How did we get here?
Published in Tobias Bischof-Niemz, Terence Creamer, South Africa’s Energy Transition, 2018
Tobias Bischof-Niemz, Terence Creamer
To pay for these initially more expensive power stations, electricity consumers have been charged an additional fee, known as the EEG surcharge, named for the Act’s German title, ‘Erneuerbare-Energien-Gesetz’. To sustain the competitiveness of the energy-intensive industry, companies meeting specific demand thresholds, which are heavily geared towards export markets, can apply for an EEG surcharge exemption. As a result, electricity-intensive firms enjoy tariffs that are lower than those across the border in France,5 even though other German consumers pay a premium, largely as result of the EEG surcharge and other taxes and levies in the tariff. The reason for this is that renewables have reduced the wholesale electricity price, as determined by the fuel cost of the most expensive operational plant. This is because, as the proportion of wind and solar PV (which have no fuel costs) rises, the ‘merit order’ shifts to the right and makes supply sources with high fuel costs, such as gas and diesel, uneconomic. For residential and commercial customers, the reduction in wholesale power prices is insufficient to offset the EEG surcharge. But for those heavy industries exempt from the surcharge, their competitiveness has actually improved with the introduction of renewables.
An overview on the status quo of onshore and offshore wind power development and wind power enterprise localization in China
Published in International Journal of Green Energy, 2019
Ruixiaoxiao Zhang, Geoffrey Q.P. Shen, Meng Ni, Johnny K.W. Wong
Besides, the renewable power has a lower priority in power dispatch. China’s power dispatch follows a coal-fired power dominated approach and capacity-based pattern. The quota of coal-fired power generators is equally assigned according to scheduled generation capacity by the local government (Wei et al. 2018; Yin et al. 2017). For example, a 400 MW unit is equivalent to two 200 MW units. In most of the other countries, the governments utilize a merit-order-based approach to dispatch power. The merit-order-based approach allows the most economically efficient power to take the priority. Unlike other countries, China treats all the coal-fired power generators fairly. Regardless of the high or low efficiency of power generation, the generators with similar size and capacity share the same generation quota. Thus, some certain amount of power is failed to be accommodated effectively. Similarly, wind power dispatch is encountering an even more difficult situation. On the one hand, the wind power is intermittent and only serves as back-up power. In Zeng et al. (2014)’s research, with Inner Mongolia as an example, they illustrate the prominent installed capacity of thermal power in the year 2014 is 31,072 MW, and among it the heating units account for 57.35%. In winter, the insufficient load regulation results in wind power abandoning to “give way” to the heating units. The same case also happens in other regions. The integration of wind power with other power sources always conflicts, and thus wind power is abandoned due to the random and intermittent characteristics.
The effect of variable renewable energy sources on electricity price volatility: the case of the Iberian market
Published in International Journal of Sustainable Energy, 2019
Paulo Pereira da Silva, Paulo Horta
Wind and solar photovoltaic (PV) power sources are favoured by the merit order rule (Cludius et al. 2014; Gouveia et al. 2014). One-day ahead wholesale electricity prices are determined by marginal costs and the one-day ahead forecast for the quantity of electricity supplied by each technology. Specifically, the one-day ahead price for each hour is defined by the marginal plant that is required to satisfy electricity demand in that hour (Roldan-Fernandez et al. 2016). Consequently, despite high levels of fixed costs and investments (Bean, Blazquez, and Nezamuddin 2017), wind and PV sources gain priority in relation to more expensive plants (particularly those with a high marginal cost), because they generate large quantities of electricity at near zero short-run marginal costs.1
Renewable energy investment study for electric power enterprise based on a time period with expected supply
Published in Enterprise Information Systems, 2023
Bei Ye, Yan Gao, Guan-Xiu Yuan
The Merit order effect is one of the most effective mechanism for a power system with renewable energy, and it helps to cut down the total cost of traded energy in the wholesale market. Many studies (Gelabert, Labandeira, and Linares 2011; Sensfuß, Ragwitz, and Genoese 2008; De Miera, Del Río González, and Vizcaíno 2008) analyse and confirm its effectiveness. In this problem, a supply merit order is set based on the different unit generation costs, which is proposed by Kök, Shang, and Yücel (2016), in our scenario as: